Does QuickFee's (ASX:QFE) Share Price Gain of 31% Match Its Business Performance?

By
Simply Wall St
Published
February 22, 2021
ASX:QFE
Source: Shutterstock

QuickFee Limited (ASX:QFE) shareholders might be concerned after seeing the share price drop 22% in the last week. But that doesn't change the fact that the returns over the last year have been pleasing. After all, the share price is up a market-beating 31% in that time.

See our latest analysis for QuickFee

Because QuickFee made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. When a company doesn't make profits, we'd generally expect to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last year QuickFee saw its revenue grow by 80%. That's stonking growth even when compared to other loss-making stocks. The solid 31% share price gain goes down pretty well, but it's not necessarily as good as you might expect given the top notch revenue growth. If that's the case, now might be the time to take a close look at QuickFee. Human beings have trouble conceptualizing (and valuing) exponential growth. Is that what we're seeing here?

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

earnings-and-revenue-growth
ASX:QFE Earnings and Revenue Growth February 23rd 2021

Take a more thorough look at QuickFee's financial health with this free report on its balance sheet.

A Different Perspective

It's nice to see that QuickFee shareholders have gained 31% over the last year. We regret to report that the share price is down 21% over ninety days. It may simply be that the share price got ahead of itself, although there may have been fundamental developments that are weighing on it. It's always interesting to track share price performance over the longer term. But to understand QuickFee better, we need to consider many other factors. Case in point: We've spotted 4 warning signs for QuickFee you should be aware of, and 1 of them is significant.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on AU exchanges.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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Simply Wall St

Simply Wall St is focused on providing unbiased, high-quality research coverage on every listed company in the world. Our research team consists of data scientists and multiple equity analysts with over two decades worth of financial markets experience between them.